Because of the drop in employer healthcare spending in the first half of 2020 and the uncertainty around spending in the second half of the year, HRI is projecting 2021 medical cost trend relative to 2020 estimated healthcare costs, normalizing for COVID-19, rather than actual 2020 costs. HRI has developed three scenarios to guide employers and health plans as they determine 2021 medical cost trend:
High-spending scenario: Spending grows significantly higher in 2021 after being down in 2020.
Medium-spending scenario: Spending grows at roughly the same rate in 2021 as it did from 2014 to 2019 and was expected to in 2020.
Low-spending scenario: Spending remains dampened in 2021.
Employers are incurring unplanned COVID-19 testing and treatment costs in 2020, and those costs likely will continue in 2021. In 2020, these unplanned costs are expected to be more than offset by the savings from delayed care during the pandemic. An increase in spending is expected in 2021 as the demand for care returns.